BiT Global accuses Coinbase of delisting WBTC for competitive edge over cbBTC
BiT Global accuses Coinbase of delisting WBTC for competitive edge over cbBTC
Coinbase's decision to delist Wrapped Bitcoin (WBTC) has sparked controversy, with BiT Global accusing the cryptocurrency exchange of attempting to eliminate competition for its own Bitcoin wrapper, Coinbase Wrapped BTC (cbBTC). The exchange announced plans to suspend WBTC trading on December 19, 2024, citing an alleged failure to meet its listing standards. However, BiT Global, a custodian of WBTC, argues the move is a strategic attempt to push cbBTC forward as the dominant Bitcoin wrapper.
“We believe Coinbase’s decision is an attempt to gain a competitive advantage by removing WBTC, the largest competitor,” a BiT Global spokesperson stated. Coinbase, however, denies these claims, maintaining that the decision was based on a routine evaluation of trading assets.
Competing Bitcoin wrappers and industry implications
WBTC, which holds over $14 billion in total value locked (TVL) according to DefiLlama, remains the most widely used Bitcoin wrapper in the market. In contrast, Coinbase's cbBTC, launched in September 2024, has rapidly grown in popularity, securing approximately $1.5 billion in TVL.
This rivalry comes amid broader concerns about the management of wrapped Bitcoin products. In August, BitGo, the custodian behind WBTC, allowed BiT Global partial control of the multisignature wallet holding its Bitcoin reserves. This decision drew criticism due to perceived risks associated with BiT Global's affiliation with controversial figures like Justin Sun. Critics allege potential mismanagement of collateral in related projects, adding another layer of scrutiny to the WBTC ecosystem.
The debate over WBTC’s delisting underscores the growing competitiveness in the Bitcoin wrapper market, with players vying for dominance in total value locked and user trust. Coinbase’s decision could signal a shift in market dynamics, as newer wrappers like cbBTC challenge the long-standing dominance of WBTC.
As the December 19 deadline approaches, the cryptocurrency industry will closely watch how the situation unfolds, particularly its potential impact on decentralized finance (DeFi) and institutional adoption of wrapped Bitcoin products.
Read also: Mastercard partners with JPMorgan to integrate blockchain-based foreign exchange system
